Costco Earns
Charles Krupa/AP
Costco Wholesale (COST) reported a first-quarter profit and sales that fell short of analyst estimates, hurt by a rise in operating expenses.

Shares of the warehouse club operator, which sells everything from carrots to coffins at its cavernous stores, fell as much as 3 percent before the bell Wednesday.

"While Costco has generally been prudent in controlling costs, Q1 selling, general and administrative [expense] was higher than we expected," Cowen and Co. analyst Faye Landes wrote in a note.

Operating expenses rose 5.5 percent to $24.3 million. Selling, general and administrative expenses rose 7.2 percent. Profit rose to $425 million, or 96 cents a share, in the first quarter ended Nov. 24 from $416 million, or 95 cents a share, a year earlier.

Analysts on average had expected the company to earn $1.02 a share, according to Thomson Reuters I/B/E/S.

Sales rose 5 percent to $24.47 billion, but missed the average analyst estimate of $25.35 billion. The company announced quarterly sales last week.
Sales at stores open at least a year rose 3 percent, including the impact of lower gasoline prices and a stronger dollar. Analysts on average were expecting same-store sales to rise 3.54 percent.

Excluding fuel and forex, same-store sales rose 5 percent.

Rival Walmart Stores (WMT) reported a third-straight quarterly decline in U.S. same-store sales last month and forecast a lower-than-expected profit for the holiday quarter.

Costco, whose members pay up to $110 a year to shop at its big stores and website, operates 648 warehouses, including 461 in the United States and Puerto Rico. It also has stores in Canada, Mexico, the United Kingdom, Australia, Japan and other Asian countries.

Shares of the Issaquah, Wash.-based company were down 1.4 percent at $118.25 before the bell.

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It's hard to beat Costco on their return policy. Excellent service there. The meat department is very good and their baked goods are tasty and priced right. I buy a lot of merchandise from Costco. Of course I dislike having to pay to walk in but that could all change for the worse if our economy keeps sliding. Don't believe the newspapers or TV or Radio, our economy is on the skids. Those with money, hang on to it, spend it like it's your last nickel. As for the rich, keep buying, they need your cash. Keeping up with your neighbors will be your undoing.

December 11 2013 at 10:49 PM Report abuse rate up rate down Reply

I wish we had a Costco. We just have a Sam's.

December 11 2013 at 8:44 PM Report abuse rate up rate down Reply

fox lie

December 11 2013 at 4:40 PM Report abuse -1 rate up rate down Reply
1 reply to Ron's comment

The big red fox jumped over the lazy brown dog. An old typing practice.

December 11 2013 at 10:02 PM Report abuse rate up rate down Reply